Tag Archives: health care

If They Depend on Subsidies…

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…then they shouldn’t be in business. The subheadline laid it out:

Republicans want to shift subsidies away from some of the frailest companies in the industry

In this context, “the industry” is the health care coverage industry, and the subsidies are those paid health coverage providers in the Affordable Care Act. I claim, though, that “private” companies that require government handouts are neither all that private nor deserving of staying in business. If they cannot survive without taxpayer money as anything more than a shortish-term loan to survive a catastrophe, they should be left to go out of business.

The news writer at the link made a big deal out of the need for the subsidies to those coverage providers in order to hold down the prices—the premiums—the customers pay for the policies, jerking tears especially for the lower income customers. What he does not address, though, is the deductibles and the out-of-pocket caps those Obamacare policies have. The deductibles and caps each separately represent significant fractions of those lower income customers’ income. They, especially, had better not get sick. If they do, their strait is not much different from that of those folks who are uninsured at all.

The subsidies paid into their hands directly would at least give them a little relief, but that’s only a stop gap. The real solution is to eliminate the ACA altogether and free up the health care coverage industry, restoring it to a health insurance industry in a free market with policies marketable nationwide, rather than limiting them to intrastate sales with the permissions and regulations of fifty different States.

Companies providing health care coverage or insurance should see their prosperity in how well they treat their customers and how well they serve them. Their prosperity should not come from government handouts—transfers from us taxpayers who don’t use their services.

The Problem with Obamacare Subsidies

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Tony LoSasso, DePaul University Professor of Economics, and Kosali Simon, Indiana University Distinguished Professor of Economics, think the problem with Obamacare subsidies is their structure and not their size, and they want a shift to a Centrally Planned scheme akin to the government-approved form of competition that is the Federal Employees Health Benefits Program, wherein Government decides (still) what is a suitable subsidy and peg[s it] to a lower-cost, benchmark plan. Under this, the coverage who selects a higher-cost plan must pay the cost increment himself. That this is all too similar to Obamacare and its Bronze plan subsidization, with consumers choosing pricier options paying the difference isn’t particularly relevant here.

LoSasso and Simon are missing the beam in one eye for the mote in the other. The problem with Obamacare subsidies isn’t their size, nor is it to whom they should be sent, as some on the right are starting to propose.

The problem with Obamacare subsidies is their existence. This broad government coverage scheme of Obamacare, advertised—still!—as the Affordable Care Act, is not, never has been, and never was intended to be affordable. The Act was intended from the outset to nationalize our nation’s health care coverage industry.

The only real solution, the only one with long-term durability, is to move our health care coverage industry back to its actual health insurance roots, and then to go a few steps further. Make insurance plans entirely salable across State boundaries. What began that century or more ago in a nascent health provision and health insurance process as wholly local and completely intrastate has long since grown to nation-wide production and market facilities, and that’s readily regulable under our Constitution’s Commerce Clause. Make health insurance policies available in one State available to prospective insurees in all States. That alone will let policy costs to the insuree (premiums, co-pays/out-of-pocket caps, deductibles) go down since the insurer will have only one set of rules with which to comply rather than 51 (the States plus the Feds).

In addition, it’s necessary to take the shackles off what insurers (not government coverage purveyors) are allowed to sell and what customers, insurees, are allowed to buy. These salable policies would range, under true, unfettered by Government, competition, from the full-up policies of pre-Obamacare that covered a broad range of ails and potential ails to policies that would cover only specific or closely related ails and potential ails to everything in between, including the sale and purchase of customer-selected bundles of policies covering specific closely related ails and potential ails.

A freely competitive market with far more limited government involvement is what will drive health insurance costs down and policy quality up. And that will have an important sequela: doctor availability, even for those on the bottom economic rungs, will go up.

All of that will take taxpayers out of the business of paying for coverages that don’t apply to them, especially including those taxpayers who otherwise would eschew health insurance altogether.

That, too

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Progressive-Democrats are keeping the government shut down over their demand to extend—permanently, no negotiations—the Obamacare subsidies that the Progressive-Democrats during the Biden reign had scheduled to expire in November of this year, pretending at the time that the subsidies were just temporary, to tide people over during the Wuhan Virus situation. Their core claim on this aspect is that Obamacare premiums, as paid by the policy holder (carefully excluding, per those same Progressive-Democrats, the premium costs paid for by us taxpayers via those subsidies), will explode.

What the press, with equal care, ignores is that the purported need for those subsidies is a direct result of the cost of the government-run health care coverage program that is the Affordable Care Act. Government-run because these are coverage policies whose coverage suites are mandated by government, including the worst mandate of them all: the requirement to charge premiums (within narrow government set bands) for ailments and potential ailments without regard for the risk of the ailment being covered, and for some of those ailments at no cost to the policy holder at all.

The Wall Street Journal has pointed out an additional price to us average Americans:

If Republicans don’t extend the turbocharged subsidies, she [Minnesota Progressive-Democrat Senator Amy Klobuchar] warned, “early retirees like Bill & Shelly [who live in Meridian, ID] will see their health insurance premiums increase nearly 300%—from $442 to $1,700.”

And [emphasis added]

This is a tacit admission that ObamaCare encourages Americans to stop working. The Biden subsidies turbocharged that incentive by making subsidies larger and available even to those with incomes above 400% of the poverty line. The couple in Ms Klobuchar’s example had north of $130,000 of income in 2024….

This demand for permanentizing the ObamaCare subsidies is just one more aspect of big government taking over our lives, reducing individual liberties (the health coverage industry does not exist in a free, competitive market where individuals can make their own choices of what coverages they want, at prices that competition would make possible) and taking the flip side of individual liberties, individual responsibilities, away from the individual and, instead, spreading them across all of us together, as brokered by Government.

The editors offer some solutions that would be a good beginning toward correcting the failure that is the ObamaCare essay into socialized medicine.

  • codifying association health plans that let small businesses join up to form a larger risk pool to improve the economics of offering insurance
  • continuing to expand plans that can be paired with tax-preferred health-savings accounts
  • fix[ing] some ObamaCare regulations like the medical-loss ratio that obliges insurers to spend 80% of premiums on claims, which in practice is a profit cap

Also needed, I claim:

  • allowing health coverage plan providers to sell policies that cover preexisting conditions at premiums consistent with the risk involved. The risk here is not certainty since the preexisting conditions will not all flare up and require medical intervention simultaneously; the risks can be amortized across time, if government only got out of the way
  • allowing individuals to choose from, and insurers to offer, tailored coverages: only primary care—annual exams, for instance, and the occasional flu or broken bone
  • coverages only for catastrophic health potentialities
  • reducing the regulatory burden on doctors who want to eschew being reimbursed via health coverage providers by doing cash reimbursements, perhaps by annual subscriptions

But to do any of that, it’s necessary for the Progressive-Democrats to end their extortionate demand on subsidies as a condition or reopening, so those discussions can begin; it’s necessary for the Progressive-Democrats to release from their basements us American people, especially the poor and their children, whom they’ve taken hostage against their demand.

12 Million Don’t Use The Health Insurance They Have

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The lede lays out the background.

ObamaCare really is a gift that keeps on giving—for insurers. The law forces Americans to buy pricey plans with benefits they don’t need. And now the Paragon Institute reports that taxpayers are subsidizing insurance for nearly 12 million people who never use their coverage.

As the WSJ puts it, here’s the wild part:

More than a third of all enrollees generated no medical claims last year, according to Paragon’s analysis. That includes 40% of those in plans that are fully subsidized. Between 2021 and 2024, the number of enrollees who didn’t use their health coverage more than tripled to 11.7 million from 3.5 million.

There are a couple of reasons for this. One is that being forced to buy something that isn’t needed or wanted bit. The other is that “purchasers,” after paying those enormously high premiums, or having the government pay those premiums with OPM, still would have to pay out of their own pockets for any health care throughout the year because of the enormously high deductibles those ObamaCare plans hide behind.

Forgive us for being old-fashioned, but why should taxpayers subsidize insurance for healthy people who don’t need or use it?

Indeed.

False Premise

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The Biden administration had argued, in the course of its participation in a lawsuit against Tennessee’s law barring transgender-based treatments for children, that

A teenager whose sex assigned at birth is male can be prescribed testosterone to conform to a male gender identity, but a teenager assigned female at birth cannot.

The Supreme Court last week issued its ruling that the Tennessee law was, in fact, perfectly fine; the ruling was 6-3, with the three activist Justices voting in dissent. Chief Justice John Roberts wrote the Court’s opinion, and Justice Amy Coney Barrett wrote a concurrence centered on answering one of the objections in the dissent. Justice Clarence Thomas wrote a separate concurrence in which he took to task all the plaintiffs’ demand that the Court knee-jerk accede to so-called experts in the Executive Branch regarding transgenderism.

However, it would have been good if the Court had addressed one more item—the Biden administration’s false premise underlying its argument.

That erroneous premise is this: that sex is assigned at birth. This is blatantly false. Sex is assigned at the moment of conception, when the male sperm, carrying either an X chromosome or a Y, joins with the egg and its X chromosome. The subsequent union, the zygote, is then deterministically a male with an XY combination or a female with an XX combination. That male or female—boy or girl—result is carried on through subsequent development all the way through fetus development and birth. The sex determination is immutably fixed at that first moment of union; it is not “assigned” later.

Had the Court put that underlying false premise to bed, also, would have obviated a myriad arguments (legal, anyway) about the origins of an individual’s transgender situation.